Eagle Tribune: Study sees economic benefit in Granite State casino

January 15, 2012

Study: Granite State gambling on revenue loss with casino delay

By Doug Ireland direland@eagletribune.com

It's a sure bet casinos are coming to Massachusetts, but the question remains how much of a gamble it is to allow them in New Hampshire.

A newly released study says it won't be much of a gamble at all.

New Hampshire would still benefit economically, especially if a proposed $450 million casino is built at Rockingham Park racetrack in Salem, the study said.

The study, released last week by the New Hampshire Center for Public Policy Studies, concludes the Granite State would receive $53 million in revenues if a casino is built at Suffolk Downs in East Boston.

But if New Hampshire doesn't act now to allow them, much of that revenue would be gambled away across the border, according to proponents. Opponents say casinos would be detrimental to the state's quality of life.

Stephen Norton, the center's executive director, said New Hampshire will benefit — no matter what happens in Massachusetts.

"When you look at it from a revenue and economic perspective, it still brings value to the state," he said.

New Hampshire would receive $119 million in annual revenue if not for the $65 million estimated "social costs" of dealing with pathological gamblers, the study said.

If the Suffolk Downs casino were not built, New Hampshire could see $189 million in revenue, the study said.

This study comes on the heels of Massachusetts legalizing casinos in November. Gov. Deval Patrick signed legislation authorizing up to three resort-style casinos and a slot machine parlor.

That's prompted some to say New Hampshire lawmakers better act now or miss out on a big opportunity.

Rep. Kenneth Weyler, R-Kingston, is one of those.

"If we can get it going, we can get this done," he said.

Weyler, chairman of the House Finance Committee, said he's been told the state has an 18- to 20-month window to allow legalized gambling before it loses its competitive edge.

"They are going to gamble, whether it's here in New Hampshire or if they go somewhere else," he said.

A sharp decline in lottery ticket sales is another reason New Hampshire should legalize expanded gambling, Weyler said.

Lottery revenues have dropped about 30 percent, from about $85 million in 2007 to approximately $60 million in 2011, the study said.

Weyler is among several sponsors of legislation that allows construction of two video slot facilities in the state.

One of those could be built at Rockingham Park, which Millennium Gaming of Las Vegas has an option to buy to convert the century-old racetrack into a casino.

Lawmakers were scheduled to debate the legislation, House Bill 593, last week. But concerns with its constitutionality delayed the discussion until next month. Republican legislators also want to make sure they have enough votes to override a veto promised by Gov. John Lynch, Weyler said.

Backers say Salem would benefit

Rich Killion, a Millennium spokesman, said the study just confirms his group's belief a casino in Salem would be a big economic asset to the town and the state.

"This would be a sizable investment that would add over 2,800 (permanent) jobs and thousands of construction jobs," he said. "There is a competitive advantage. New Hampshire, by doing nothing, would simply secede that advantage."

The study says construction of a casino at Suffolk Downs would have the most impact on New Hampshire. Casinos also have been proposed in Brimfield, Foxboro, Milford, Palmer and Charlton, Mass.

If casinos are built in Massachusetts and not the Granite State, New Hampshire residents will head south to play slot machines or blackjack, Weyler said.

Busloads of New Hampshire residents already travel to casinos in southern New England each day to spend their money, he said.

That's one reason why Rep. Susan Almy, D-Lebanon, opposes the expanded gambling legislation.

She said she is not convinced casinos would be an economic or social benefit to the state. Any casino built in New Hampshire couldn't compete with Mohegan Sun and Foxwoods, both $1.5 billion-dollar operations in Connecticut, Almy said.

A New Hampshire casino would drain profits from existing restaurants, hotels and businesses, she said. Studies also show crime increases wherever casinos are built, Almy said.

But Elizabeth Roth, chairwoman of Salem's Board of Selectmen, said a casino could prosper at Rockingham Park. "I'm a strong proponent of developing Rockingham Park racetrack," Roth said.

She was among a group of local officials who toured the Meadows Racetrack & Casino in Washington, Pa., last summer. After that trip, Roth said she learned a casino in Salem could create jobs without increasing crime.

Salem Town Manager Keith Hickey and Salem selectmen agree locating a casino in town would be an economic benefit. So does House Majority Leader D.J. Bettencourt, R-Salem.

"What's clear coming out of this report is a definite economic benefit to the state of New Hampshire moving forward," Bettencourt said. "What's even more clear from this is if New Hampshire doesn't move forward immediately, we could lose not only the sizable economic impact, but we will lose thousands of jobs."

Both sides debate losses, gains

Not allowing expanded gambling in New Hampshire would mean a $73 million net loss to the state if casinos were built at Suffolk Downs and in Palmer, the study said.

That loss to New Hampshire would drop to $48 million if casinos were only built in Palmer and Foxborough, the study said.

But New Hampshire has even more to lose if it adopts expanded gambling, according to former state Sen. Jim Rubens.

Rubens, a spokesman for the Granite State Coalition Against Expanded Gambling, disputes the study's findings.

"It's not scientifically accurate," he said.

Rubens said the study is comprehensive, but does not account for what he calls "abused dollars."

That's gambling money stolen or taken under false pretenses from family members and others, but not reported as a crime, he said. That adds up to about $30 million a year, he said.

"It's practically no benefit to the state," Rubens said.

The center neglected to include that research in its study, he said, although it's research commonly found in other studies on gambling.

The study also fails to consider gambling's impact on New Hampshire's reputation, according to Rubens. The state's tourist economy would suffer if casinos are built here, he said.

"When you bring gambling casinos into New Hampshire, they will become the biggest political force," he said. "When you look at the states that have gone down that road, there is always political corruption."

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